Singaporean man who helped Thai wife in S$25 million Tradenation luxury goods scam jailed

SINGAPORE: A Singaporean man was sentenced to five years and 10 months' jail on Tuesday (Oct 14) for his role in a luxury goods reselling business that cheated dozens of customers of almost S$25 million (US$19.2 million).

Pi Jiapeng, 30, started the business with his Thai wife Pansuk Siriwipa, who was sentenced last year to 14 years' jail.

He pleaded guilty to three charges of being a party to fraudulent trading, breaching his duties as a director and money laundering. Another four charges were taken into consideration.

The couple married in September 2020 and started a business called Tradenation, selling luxury watches in Singapore in May 2021. Pi was the sole director of this company.

They opened a second company called Tradeluxury around January 2022 to sell luxury bags. Pansuk was the main decision-maker for both companies.

Pi made withdrawals and transfers from Tradenation’s account on Pansuk's instructions, liaising with customers on occasion and delivering the goods to customers.

He did not have any substantive involvement in Tradeluxury.

Both companies primarily operated on a pre-order basis, offering prices that were 10 to 20 per cent lower than local resellers by getting goods from cheaper overseas suppliers.

The products were offered for sale through Instagram, Carousell and Telegram. 

Customers would make full payments before the companies procured and delivered the goods. They were offered the option of a full refund if pre-orders were not fulfilled.

From the end of 2021 to the start of 2022, Tradenation started facing sourcing difficulties due to shipment delays and other issues with the overseas suppliers.

Both companies began operating at a loss and had net liabilities of S$1.78 million by the end of February 2022.

Despite this, Tradenation continued to accept orders and collect payment. Pansuk did this because she needed the funds to purchase stock to fulfil the earlier orders.

In February 2022, Pi became aware that Tradenation was making some purchases of watches from local resellers instead of overseas suppliers. He knew this because he made the substantial bank transfers to the local resellers, and he was aware that this was likely to cause losses to Tradenation.

He also knew that the prices of watches should go up around Chinese New Year, but in February 2022, he observed that the prices of watches were dropping by a few thousand dollars daily. As a result, he knew that Tradenation would have to let go of watches it had bought in January 2022 at a loss.

By Mar 1, 2022, Pi began to feel uncomfortable with running the business and was unsure if it was turning a profit. However, he allowed his wife to continue running the business and continued to process the transfers and cash withdrawals she requested.

In January and February 2022 alone, Pi processed cash cheques from Tradenation's account for approximately S$3.2 million.

He was essentially unconcerned about whether Tradenation made a profit or a loss, provided that he was still able to draw a salary and did not feel an impact on his lifestyle, said Deputy Public Prosecutor David Koh.

The couple considered halting pre-orders in March or April 2022, but did not.

Between Mar 1, 2022 and Jun 19, 2022, Pi was party to the collection of payments of almost S$25 million from customers of Tradenation when he knew the company could not fulfil those orders.

The amounts were taken from 178 customers, whose orders were not fulfilled.

In April 2022, Pansuk transferred more than S$176,000 from her bank account as a down payment to buy a Chevrolet Corvette C8 2Lt in Pi's name.

A large part of this sum was traceable to proceeds of criminal conduct - essentially from the victims of Tradeluxury.

At the time, Pi already owned three cars - a Toyota Alphard, a McLaren Couple and a Porsche Macan S II PDK E6.

However, he wanted the Corvette as he believed it was the only such car in Singapore at the time. He also wanted the car as an investment, as he believed its value would appreciate.

During the offending period, despite the fact that both companies were operating at a loss, the couple continued to rack up significant expenditures that were funded by their customers' payments.

Pi received a salary of S$40,000 a month from Tradenation for several months, and a salary of S$12,000 a month from Tradeluxury.

A total of 187 police reports were filed against the two companies between May and August 2022.

While under investigation, the couple hid in a lorry and left Singapore illegally. They were later located in Malaysia and handed over to the Singapore Police Force.

HE WAS CONTENT TO DO NOTHING: DPP

The prosecutor sought five-and-a-half to six-and-a-half years' jail for Pi, noting that he was the director of both companies. 

"The accused failed abjectly in that duty and instead, enabled both companies to be used as vehicles of fraud," said Mr Koh.

He said Pi was "content to do nothing in the company, leaving it entirely to his wife and a friend to run". On some occasions, he literally gave his wife blank cheques and allowed her free access to company funds.

Pi continued to "live large, drawing lavish salaries from both companies and chartering a private jet for a holiday", said Mr Koh.

Pi was represented by Ms Tan Jun Yin and Ms Sugenya Manogaran from Trident Law, who asked for a slightly lower sentence.

They cited the judge's decision in Pansuk's case and said she was the main decision maker, even though she was not a registered director of either company.

"As for our client, he essentially operated as a bank transfer assistant and a deliveryman," said Ms Tan.

She said he never made a single transaction or delivery that was not on his wife's instructions.

"Put it simply, your honour, Ms Pansuk could have run this business without our client. All she would have needed to do was to find another Singaporean to stand as director, whereas he couldn't have run it without her because he didn't have the customer contacts and didn't know which supplier to get (the goods) from," said Ms Tan.

As for why he took such a hands-off approach, Ms Tan said the couple had run two businesses before Tradenation, operating on the exact same business model.

They had sold masks, skincare, cosmetics and snacks with overseas suppliers and operated on a pre-order basis, and both the businesses were successful, said Ms Tan.

Pi, therefore, felt assured that the business would be run properly when his wife replicated the same business model for Tradenation, said Ms Tan.

In sentencing, the judge noted that both husband and wife enjoyed the gains of their crimes together.

She gave similar sentences to what Pansuk received in terms of her individual charges, on account of parity.